Credit Suisse reports 33 percent rise in 2Q profit

Article by: JOHN HEILPRIN

Associated Press

July 25, 2013 - 12:50 PM

GENEVA — Credit Suisse on Thursday posted a 33 percent rise in second-quarter profits from a year ago, driven by solid returns from its scaled-backed investment banking division as well as other cost-cutting.

The Zurich-based bank said it made a net profit of 1.045 billion Swiss francs ($1.11 billion) in the second-quarter, up from 788 million francs in the comparable period of 2012.

That was based on a rise in net revenue to 7 billion francs from 6.3 billion francs, according to a second-quarter statement from the bank, second in size only to its crosstown rival, UBS AG, the nation's biggest.

Credit Suisse also has been increasing its capital reserves to meet strict new banking regulations, and said that is has trimmed $112 billion in risk-weighted assets from its investment banking since late in 2011. Like UBS, Credit Suisse is on the list of the 29 "global systemically important banks" that the Bank for International Settlements — the Basel, Switzerland-based central bank for central banks — considers too big to fail.

Chief Executive Brady Dougan said the bank's "business model is performing well" and that it continues to make progress in reducing its cost base and balance sheet.

The bank said its private banking arm for wealthy clients had 7.6 billion francs in net new assets, with strong inflows in emerging markets, though profits fell. Its investment bank had pretax income of 754 million francs, more than double from the 314 million francs of a year ago.

The bank said it was on track to cut costs by 4.4 billion francs by the end of 2015 and had trimmed staff to 46,300 in the second quarter, down almost 4 percent from 48,200 a year earlier.

It also confirmed that it is one of the Swiss banks which asked the country's government for permission to share specific information on suspected American tax cheats with U.S. authorities so that it can avoid a protracted legal fight and stiffer penalties. Credit Suisse has already handed over some data on U.S. clients and bank employees.

Dougan, however, said it would be hard to predict when Credit Suisse might finally put the matter to rest.